$5 a gallon for gas? Get ready, experts say

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I can believe it. cuhulin

Reply to
cuhulin
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Get ready means "bend over".

Reply to
hls

"hls" wrote in news: snipped-for-privacy@giganews.com:

It's Bernanke that's doing it. He's the 21st century's Arthur Burns.

Oil is exactly the same price it's been since about 1950. No kidding.

Reply to
Tegger

The price of crude oil in the 50's was around $3/bbl

Reply to
jim

Gold in the 1950s, was about $35.00 an ounce, wasen't it? I should have started buying Gold wayyyyyy back then. cuhulin

Reply to
cuhulin

When I started working in the oil industry in the 60's, oil was $5-6 per barrel. So, what is a dollar???

Reply to
hls

"hls" wrote in news: snipped-for-privacy@giganews.com:

A lot smaller than it used to be, thanks to the likes of Bernanke.

An ounce of gold bought 12 barrels of oil in the '60s. An ounce of gold STILL buys a 12 barrels of oil today. You did't know that, did you?

ALL the "inflation" you see has been in that phony government-money called the "dollar", which as lost over 90% of its value since 1971.

Reply to
Tegger

"So, what is a dollar???"

It's the Argentine Peso (or Argentine Austral? or Argentine New Peso?) of the 21st century. The cheap version of a Confederate Dollar or Weimar Reichmark. It also doesn't buy much and that value will decline greatly very soon.

Reply to
AMuzi

Save your Confederate Money boys, the South is going to Rise again! cuhulin

Reply to
cuhulin

Ya gotta watch those Mexicans :)

Reply to
Bret

It's called "inflation". The price of everything will always go up since currency is designed to loose value over time. The ultimate result is that nothing really changes, the cost of goods go up, peoples pay goes up and in the end you have to work the same number of hours to be able to buy the same stuff.

Reply to
Pete C.

Back during the German Weimar Republic/World War Two era, somewhere around that time frame era, it took a wheelbarrow full of German Marks/Money just to buy a loaf of bread.

I once drove a bread truck for a bakery.In some of those stores I used a magic marker to mark on the ends of the bags, 2/39. (two 1 1/4 pound loaves of sliced sandwich bread for 39 cents) Of course those stores were getting a kick back from the bakery.

Don't Say Bread, Say Sunbeam? cuhulin

Reply to
cuhulin

I would be glad if it cost just $5, here in Europe it is around $8 already.

Reply to
Thomas Tornblom

Inflation is the increase of the money supply. It's how the wealthy (who own the banks) get more wealthy. Essentially the loss of buying power of your savings is transfered to them as they get the use of the newly created money before the prices go up. They use the new money to aquire assets at the old prices.

There is no way to compare pump price to pump price because of the different tax models. What should be compared is the cost of the gasoline itself, not the price at the pump. Each time I've done this the difference between the US and europe isn't very big.

Reply to
Brent

Riiiight. I pay 3 1/2 bucks, he pays 8 bucks. So because of taxes, we're paying the same price. You're quite an economist.

Reply to
Vic Smith

Not at all. Inflation is the increase in prices of goods and services brought on by demand. Increasing the availability of money does tend to increase demand, but there is no guarantee. For example the huge increase in the money supply in the last 30 mos has had very slight effect on demand.

You say that as if you assume people have savings. The vast majority of Americans are deeply in debt. For someone heavily in debt inflation works in their favor and falling prices would be disastrous. The most blatant example is what happens when you have a mortgage that equals half the value of your home and home prices start to fall.

Why would a consumer of gasoline not compare pump prices?

-jim

Reply to
jim

The reason these various monetary and tax systems exist is because so many people have your level of intelligence that others can take advantage of.

I'll make this simple so you can understand. As many people in the US know, the sales tax in Chicago, Illinois is rather high. You can buy a new DVD player in chicago, priced at $70. You can go to another location of the same chain retailer in northwest Indiana and the price is $70. Now in Chicago, thanks to the 11% sales tax, you'll pay 4% more than you would in Indiana. The price of the DVD player is the same, the taxes are different.

Reply to
Brent

Wow. You've educated me now. So you're saying the guy in Europe can just drive over here to Illinois to fill up. More brilliance. Hey, he pays 8 bucks a gallon, I pay 3 1/2 bucks a gallon. That's all you gotta know to compare gas prices. Despite what you say, there'a a big difference in what we pay for gas.

Reply to
Vic Smith

Wrong. Increasing prices are a symptom of an increasing money supply. Not all prices increase evenly and because suppliers are reluctant to increase prices, inflation does not show up in finished goods and services right away. Most of the Ben's helicopter dropping is locked up in bank reserves, however it is showing up in commodities.

And when you operate in that manner, to discourage savings and encourage debt, you undermine the entire economy and society. People become very present focused. Also, a low savings rate should mean high interest rates. Interest rates are the cost of borrowing money. The time preference of money. Flooding in new money to rig interest rates shifts the time preference to the present.

As to the price of one's home, it falls in the bust phase of the inflationary boom-bust cycle (when the new money went into homes). You have to live somewhere. The only thing that really matters is the price relative to other homes. If the price falls below what you owe, well there's a chance to walk away and stick the bank with it. That's part of the hazard of blowing bubbles with large supplies new and cheap money.

Now had the fed never blown a bubble in the first place, if there was a forced discipline on the money supply, there would not have been a problem. Prices would go down on goods and services every year as people became more productive. This doesn't hurt electronics or any other industry that has a productivity increase rate higher than the fed's inflation rate.

I suppose if he doesn't care who/what is stealing from him he wouldn't look any further than the pump price. People notice the tax differences on other goods where the tax isn't rolled into the price and go to lower tax territories to make their purchases. People are attracted to buy gasoline in other states and counties nearby because of a lower tax rate, most seem to understand it's a tax difference locally but have difficulty grasping it when the two locations are far from each other.

Reply to
Brent

Say you live in a state that has a 6% income tax rate and have a salary of 75K/yr. Another guy lives in another state with no income tax, he also has a salary of 75k/yr. Does he make more money than you?

Reply to
Brent

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